In California, investors have numerous rights and protections under securities laws and regulations.
The California Securities Act of 1968 is a securities law that regulates the offer and sale of securities in California. It is designed to protect investors from fraud and to ensure that they have access to accurate information about securities before they invest.
The California Securities Act requires most securities offerings to be registered with the California Department of Financial Protection and Innovation (DFPI). However, there are a number of exemptions from registration, such as offerings made to accredited investors, offerings of exempted securities, and offerings made in connection with certain small business development companies.
The California Securities Act also regulates the activities of broker-dealers, investment advisers, and investment companies. Broker-dealers must be registered with the DFPI and must comply with certain rules and regulations, such as the requirement to maintain net capital and to conduct customer accounts in a fair and equitable manner. Investment advisers must also be registered with the DFPI and must comply with certain rules and regulations, such as the requirement to provide clients with certain information about their investment strategies and fees.
The California Securities Act also prohibits certain fraudulent and deceptive practices in connection with the offer and sale of securities. These prohibited practices include making false or misleading statements about a security, engaging in insider trading, and churning a client's account.
The California Securities Act is enforced by the DFPI. The DFPI has the power to investigate potential violations of the law, to bring enforcement actions against violators, and to impose penalties, such as fines and injunctions.
Here are some of the key provisions of the California Securities Act:
Securities offered and sold in California must be registered with the DFPI, unless an exemption applies.
Broker-dealers and investment advisers must be registered with the DFPI.
Fraudulent and deceptive practices in connection with the offer and sale of securities are prohibited.
The DFPI has the power to investigate potential violations of the law and to bring enforcement actions against violators.
Here are some of the exemptions from registration under the California Securities Act:
Private offerings made to accredited investors.
Offerings of exempted securities, such as government securities and securities issued by certain nonprofit organizations.
Offerings made in connection with certain small business development companies.
Offerings made through certain crowdfunding platforms.
In addition to the California's Corporate Securities Law of 1968, other federal protections include:
Contract our law firm to discuss your rights and options for recovering investment losses.